Bitcoin spot ETF approved and predicted next week
BlackRock, a major US asset management company, expects the US Securities and Exchange Commission (SEC) to approve a Bitcoin (BTC) spot ETF on the 17th. This was reported by Fox Business.
BlackRock filed an application for a Bitcoin ETF on December 29, along with Grayscale Investments, Valkyrie, ARK 21Shares, Invesco and others.
BlackRock named JPMorgan Securities LLC and Jane Street Capital as named participants in the filing. JPMorgan is expected to increase the legitimacy of ETFs in the traditional financial industry by providing liquidity and creating and canceling them.
connection: BlackRock and Valkyrie Bitcoin ETF, JP Morgan and others to provide liquidity
Bitcoin ETF issuers have cleared key hurdles required by the SEC, and SEC commissioners are scheduled to vote on exchange regulation filings next week, according to Bloomberg.
It is also reported that some investors are already planning to invest in BlackRock’s ETF once it is approved. It is said that the plan is to transfer funds worth approximately 290 billion yen ($2 billion) from physical Bitcoin to Bitcoin physical ETF.
Additionally, BlackRock plans to reduce its workforce by 3% (approximately 600 people). Sources say the money freed up by the cuts will be used to expand growth businesses, such as investing in technology and alternative assets, rather than investing in stocks or bonds.
Cryptocurrency (virtual currency) is also said to be one of the alternative assets, but it has not been announced specifically to which assets BlackRock will allocate funds.
connection: Significant progress in Bitcoin ETF application, SEC commissioners to vote next week, possible $2 billion inflow
What is Bitcoin ETF?
An Exchange Traded Fund that includes Bitcoin as an investment. An investment trust is a financial product that collects money from investors into a single fund and invests it in stocks, bonds, etc. The system is such that the investment results are distributed according to each investor’s investment amount. Among investment trusts, ETFs are listed on stock exchanges, so they can be bought and sold just like stocks.
▶️Virtual currency glossary
Market forecast after approval
Many believe that a Bitcoin spot ETF, if approved, would have positive long-term results. On the other hand, some believe that there is a possibility of “fact selling” occurring in the short term.
For example, an analyst at K33 Research, a cryptocurrency analysis firm, points out that “a significant proportion of short-term market participants are focused on ETF approval events as an opportunity to profit,” and the probability that the approval will lead to selling. It was predicted to be 75%.
connection: “Possibility of actual selling due to Bitcoin spot ETF approval” K33 Research’s opinion
Regarding the long-term outlook, Coinbase researcher David Duong said in November:
In the long term, a Bitcoin spot ETF, if approved, could add billions of dollars to the crypto market’s market capitalization and spark further investment in cryptocurrencies.
Although such growth is expected to take time, ETF approval is expected to provide the foundation for a regulated environment, increased inclusivity, and significantly increased demand.
Duong predicts that while the arrival of physical ETFs will make it easier for pension funds and other organizations to add Bitcoin exposure to their portfolios, such investments will not be approved any time soon. . For this reason, he says, “It takes time to grow.”
Learn about Bitcoin ETFs from the beginning: Explaining the advantages and disadvantages of investing and how to buy US stocks